The U.S. markets ended up making slight gains last week as the markets had expected a better employment picture and a resolved Greek debt situation. The dismal job report announced Friday demonstrated that the U.S. economy may not be as strong as some had expected. This took away from some of the gains made earlier on in the week. Aside from the quite volatile performance of the general markets, both silver (SLV) and gold (GLD) have soared consistently to higher levels in the past week.
The case for a continuation of higher metal prices is quite evident through many economic indicators and macro factors. Many analysts are also predicting much higher prices for the next half of the year. Phillip Futures believes the investment demand for silver is likely to ramp back up and is anticipating the price to hit $45/oz. Merryll Lynch also raised both its estimates for gold and silver for both 2011 and 2012. In the same instance, they downgraded other commodities such as copper, lead, zinc and nickel. One estimate on the high end for gold is made by Erste Group which believes that a price target of $2000 is conservative. Erste's recent report explains that at the end of gold's current trend it expects at least $2300/oz.
Gold and silver's historical bullish seasonal trend
Another case for higher metal prices in the coming months is a seasonal trend that portrays that gold usually performs strongest from August to December. Therefore buying in July could prove to be a rewarding investment over the coming second half of the year.
The following chart from goldstockbull.com averages the monthly change of the price of gold over the past nine years:
